Dynamic hypothetical bias in discrete choice experiments: Evidence from measuring the impact of corporate social responsibility on consumers demand

Abstract

This paper is aimed at studying the dynamics of consumers' preferences for corporate social responsibility. The data come from both a Discrete Choice Experiment (DCE) and a field experiment conducted in a real market setting. The results show that in a static setting (first month) predictions of a standard DCE study and real market shares are statistically similar for the various profiles of corporate social responsibility. However, as time evolves real market shares present some dynamic patterns that are not mirrored by the standard DCE predictions. The overall conclusion is that differences between real market behavior and DCE data can be attributed to the lack of learning experience — or adaptation — in DCE surveys rather than to the hypothetical nature of the experiments.